Will Low Gas Prices Continue in 2014? [AUDIO]
AAA reports the average price for a gallon of regular gas was $3.49 in 2013. That's down about 12 cents from the record price set in 2012 and is a couple of cents cheaper than 2011.
That trend is expected to continue according to Tom Kloza, chief oil analyst at Gasbuddy.com.
"Thanks to lower crude oil prices and higher crude oil production, we'll probably see slightly lower prices in this region than we did last year."
While the fall in prices throughout 2013 was steady, Kloza said there was a four-month period at the end of the year where prices increased. He attributed the rise to a rebounding economy, specifically more people driving to work, however he doesn't see an economic rebound rising prices for long.
"As you look at the standards that are coming in for automobiles, they have to get to a 36 miles per gallon average by 2016 and we also have an aging population which indicates that people are going to drive a little bit less."
Kloza noted that while a reasonable fall in prices is a good thing, consumers shouldn't hope for a drastic plummet since that would be a sign of bad economic news.
"That would mean we're in a real economic recession. When oil prices went from $145 to $133, it didn't have anything to do with the basic value of oil, it had to do with unwinding from the financial companies," Kloza said.
A piece of good news, Kloza says oil costs in the US should be largely unaffected by foreign turmoil since there is so much domestic production. However, he notes with so many refineries in the US Gulf Coast, another damaging hurricane or natural disaster could be trouble.
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|New Jersey Gas Prices provided by GasBuddy.com|